Loans and Credits to Foreign Countries

Report Outline
Measures for Government Aid to Finland
Public War and Post-War Loans to Europe
Government Supervision of Private Loans
Export-Import Bank and Foreign Credits
Special Focus

Measures for Government Aid to Finland

Passage by the Senate of a bill which, without specifically mentioning Finland, would permit extension to that country of an additional Export-Import Bank credit of $20,000,000 for purchase of non-military supplies, advanced a step nearer conclusion a proposal recommended by President Roosevelt on January 16. An initial Export-Import Bank credit of $10,000,000 had been made available to Finland in mid-December. The administration had given further evidence at that time of its desire to assist Finland by placing the semi-annual payment on the Finnish war debt to the United States in a suspense account pending congressional action on suggestions that the current installment, and possibly past installments also, be remitted to that country for relief or similar purposes in the present emergency.

By the time Congress convened, January 3, it had become evident that while Finland required civilian supplies, her most pressing need was for military equipment and munitions. In consequence, various bills were introduced to authorize government loans to Finland, in amounts ranging up to $60,000,000, without restrictions as to the type of purchases to be made or, in the case of some of the bills, for the specific purpose of financing purchases of war materials. However, realization that government lending to a belligerent for the purchase of war materials might constitute un-neutral action was reflected in the unexpectedly cautious message sent to Congress by the President on January 16.

Roosevelt's Recommendations; Action of Senate

After stating that Finland's December debt installment had been segregated in a separate account “pending such action, if any, as the Congress might desire to take with respect to it,” the President observed that there was “without doubt in the United States a great desire for some action to assist Finland to finance the purchase of agricultural surpluses and manufactured products, not including implements of war.” He added that there was “at the same time undoubted opposition to the creation of precedents which might lead to large credits to nations of Europe, either belligerents or neutrals.” While stressing the point that the question was one for determination by Congress, the President said: